On paper, the latest iMacs are a big improvement over the previous generation. After only incremental improvements to its range of iMac desktop PCs over the past couple of years, Apple announced revamped 21.5-inch and 27-inch ranges in June.

The new range offers some big enhancements including better screens and the latest seventh-generation Intel i5 processors (code-named Kaby Lake). We borrowed the top-end 21.5-inch model from Apple to see how far they've come.

All three new 21.5-inch iMacs come with 8GB of RAM (memory) and two high-speed Thunderbolt 3 ports. The $1599 entry-level model lacks some of the inclusion of the other two models. It has a 2.3GHz dual-core (rather than quad-core) i5 processor, a conventional 1TB (terabyte) hard drive and a 1080p (1920 x 1080 pixel) non-retina display driven by Intel onboard graphics.

The next two models come with quad-core processors, dedicated graphics cards and ultra-HD (4K) displays, for $1899 and $2199 respectively.

We tested the top model with quad-core 3.4GHz CPU (Turbo Boost up to 3.8GHz), Radeon Pro 560 graphics card (with 4GB RAM) 1TB Fusion drive for storage. The 8GB RAM is expandable to 32GB and there are also plenty of ports: four USB 3.0, two Thunderbolt 3 (USB-C type), gigabit Ethernet and a full-sized SD card slot.

So minimalist is the iMac design that it's the screen you really notice. Though not as physically imposing as the 27-inch iMac, the display is impressive. The improved anti-glare finish on the screen is among the best we've seen.

Even though the screen has a glossy finish with a slight tint that really makes the colours look vibrant, that same glossy finish doesn't reflect your image like a mirror, so you don't get distracted by reflections of your face or even room lighting.

With this model Apple has set the high bar for screen brightness at a dazzling 500 nits (brightness units), which is 43% brighter than before. This makes it suited to even a very bright room, while the ambient light sensor can automatically dim the screen when the light drops.

We rate the iMac's viewing angles as excellent, and its colour was preferred in our tests over our reference (previous-generation) 27-inch iMac. The colours looked accurate compared to our reference, but the extra brightness made the colours look more vibrant, with more 'pop' overall.

There's a little trick to getting the most out of the 4K display. At the default screen setting, the screen actually runs at an apparent 2048 x 1152 resolution (in 'pixel-doubled' mode). This gives you give plenty of space to line up two windows side by side – say, a web browser and a document page. It's a very usable balance of high-resolution and everyday easy viewing for documents and menus.

If you want more screen real estate, the Display control panel offers you two 'More space' options of 2304 x 1296 pixels and 2650 x 1440 pixels. By this time the onscreen type is getting fairly tiny. To get the full 4K (4096 x 2304 pixel) resolution you need to hold down the Option key while selecting 'More space'.

This is really something you only want to do if you're using 4K applications, such as editing high-resolution pictures or 4K video, or if you have eyes like a hawk. For most purposes the default resolution is fine.

Apple's 1TB Fusion drive generally works very well, boosting storage performance overall by 'intelligently' shuttling frequently used files to the 32GB Flash storage area and less-used files to the slower but higher capacity hard disk drive.

While offering the best of both worlds, in practice the performance of the drive will vary depending on whether you're accessing regularly used data or new data. We found that read speeds varied from a relatively pedestrian 62MBps (megabytes per second) all the way up to a scorching 776MBps. Similarly, write speeds ran from 59MBps to 544MBps.

In real-world use, regular tasks get far quicker disk access than tasks that are only sporadically performed. Overall, the Fusion drive is a great overall performance booster and it can be had as a $160 extra-cost option on the two cheaper 21.5-inch iMac models.

Sure, it's not as fast as a full SSD (solid state drive) but you get much greater capacity and it's definitely a better bang-for-your-buck. As with an actual SSD, the extra performance should keep your Mac more useable for longer.

You don't want to ruin the sleek, wireless profile of the iMac by plugging in external speakers and thankfully the inbuilt ones are good enough that you don't have to.

Though the audio output is not quite as good as as the larger-bodied previous generation 27-inch iMac that we used for comparison, we rate the sound quality of the 21.5-inch iMac as very good, and easily good enough for personal listening.

The 21.5-inch iMac has plenty of ports, with four USB 3.0 (5Gbps) and two Thunderbolt 3 (40Gbps) connections. While that's only two kinds, Thunderbolt 3 (which uses a USB-C shaped connector) is not only the fastest connection standard, it's also the most versatile.

With an appropriate adapter you can add an external display or two via HDMI or DisplayPort. For example, we were able to use two USB-C adapters to add a 4K TV and a Full HD monitor to the iMac, for a total of three displays at the same time, and the iMac handled it easily.

Alternatively, you could add an extra monitor and some super-fast Thunderbolt 3 external storage, for example, or even some high-end Virtual Reality (VR) devices, which the iMac is now fast enough to support for the first time.

While there isn't going to be a 21.5-inch version of the recently announced super-performance iMac Pro, due late this year, the 'little brother' iMac now has the performance to handle pretty much anything you can throw at it, particularly if you opt for a higher-speed model.

Of course, if you still want to spec it up to the max you can option it up online with a 3.6GHz quad-core i7 CPU (Boost up to 4.2GHz) for $320, plus 32GB RAM ($960) and a 1TB SSD ($1120), but for that total cost you'd need to consider the 27-inch models also.

The 21.5-inch iMac is very home-friendly. It has kept the same thin and compact body as its predecessor, which is a good thing if you have limited desk space. The keyboard and mouse are wireless, so there's only a single cable (for power) to bother with. If you don't have a bunch of devices plugged into its plentiful ports you can move it around easily to various spots around your home.

If you're in the market for a compact desktop computer, it has everything you need built-in straight out of the box and should be right up there on your consideration list.